Alternative Investments: Valuation of Wine as a Means for Portfolio Diversification

This article analyses wine as an alternative investment tool and its relevance for investment portfolio diversification. Advantages and disadvantages of alternatives, benefits and weakness and peculiarities of investing in wine are systemised. In addition, the article looks at statistical data analysis of fine wine market and compares wine with other investment tools. The examination is based on three investment instruments: US equities (using S&P 500 index), bonds (using US 20-Year treasury constant maturity rate/DGS20) and wine (based on Fine Wine Investable index) using 1993–2012 (end of year) data. The investment portfolios made with two and three above-mentioned investment tools basing on H. Markowitz's investment portfolio theory and effective curves are presented. It was found that return on investments only from equities and bonds or wine and one of these traditional instruments are signally less than from the investment mix of all three tools. Furthermore, portfolios made only from equities and bonds provide the lowest return compared to others. Choosing from two investments portfolios, results of bond/wine portfolios propose higher return with the same risk level compared to equities/wine portfolio. Consequently, despite some slowdown of wine index during financial crises, wine relevance for portfolio diversification in post crises period was proved

Identification of Indicators’ Applicability to Settle Borrowers’ Probability of Default

Borrowers default risk is one of the most relevant types of risk in commercial banking and its assessment is important to secure business profitability and avoid huge losses during economic turbulences. This leads to necessity to investigate topics related to assessment of borrowers’ default probability and applicability of factors, which would enable to capture the newest trends of borrowers’ markets. Leading economic indicators (in addition to financial and other economic indicators) are often suggested as forward-looking in scientific literature. However, there is still a discussion going on applicability of financial ratios and economic indicators. As the problem is relevant in theoretical view as well as for practitioners, this article aims to identify applicability of leading economic indicators for the estimation of default probability. Further, the qualitative criteria for factor selection were identified and used when using detailing, grouping and SWOT analysis methods. Based on current scientific literature analysis, this paper concludes that although leading economic indicators are able to capture forward-looking signals, they should be used with careful analysis of its drawbacks and in combination with financial factors in order to avoid overshooting effects. The limitation of the article is the analysis of factors based on rather theoretical analysis than estimation of quantitative criteria. This suggests that every time using leading economic indicators requires using empirical study of particular indicators’ set

Finansiniai sprendimai: finansinių sprendimų formos

Vadovėlyje „Finansinių sprendimų formos“ aprašomos įvairios finansinės priemonės, skolinimosi ir finansavimo galimybės. Kiekvieno skyriaus pabaigoje studentai ras klausimų, skirtų įgytoms žinioms patikrinti. Knygoje pateikiama medžiaga apie finansinių sprendimų formas ir jų taikymo ypatumus atliekant įvairias finansines operacijas, priimant investavimo ir skolinimosi sprendimus. Gali būti naudojama studijuojant finansinių investicijų ir asmeninių finansų valdymo, finansų rinkų, finansų sistemų, kreditavimo ir kitus su įvairiais finansiniais sprendimais susijusius dalykus

Factors affecting personal customers’ trust in traditional banking: case of the Baltics

Nobody disputes that trust is an important issue in choosing a financial service provider, especially in the area of new forms of banking. The goal of this paper is to assess the most important determinants of trust in traditional banking. The study was conducted in the baltics and personal customers had to rank the distinguished factors. Using correlation analysis and binary logistic regression model it was found that the most significant factor influencing trust in all countries is provided information by the bank. In addition, in lithuania – bank’s characteristics, in latvia – customers’ risk perception and bank’s characteristics, in estonia – respondents’ experience of cooperation with a bank were highlighted as significant. The following measures of fit are used in order to describe the created logistic models: contingency table test, nagelkerke pseudo-r2, pearson chisquare test, wald test. However, there is a limitation – the survey was conducted online. Nevertheless, as internet penetration rate is high enough in investigated countries (from 76 percent in latvia to 91 percent in estonia), survey results can be adapted for at least seventy-five percent of each country’s population. The findings have implications on the development of the strategy and the policy of commercial banks

Art investments for portfolio diversification

The paper constitutes an argumentation of art investments as portfolio diversification tool, presents conception of investments in art and analyses the impact of environment on art investments. In addition, the basic art market indexes were compared and Artprice Global Index forecast was conducted by applying the Moving Trend Line method. The main objective of this paper is to investigate art as an investment tool for diversification of investment portfolio. In order to evaluate the possibility to use art investments for portfolio diversification a correlation regression analysis was made. Creating and assessment of optimal portfolios and finding efficient frontiers was based on the material of C. W. Holden from Indiana University, entitled “Excel Modelling and Estimation in Investments”. The article compares return and risk of the portfolios comprising art investment.Straipsnyje nagrinėjama investicijų portfelių optimizavimo galimybė, naudojant meno vertybes kaip skirtingos struktūros portfelių diversifikavimo priemonę. Apibūdinama investicijų į meno vertybes koncepcija, atliekamas išorės poveikių investicijoms tyrimas. Taip pat pateikiami pagrindiniai meno rinką atspindintys indeksai. Siekiant nustatyti investavimo į meno vertybes perspektyvas, buvo atlikta visuotinio meno vertybių vertės indekso (angl. Artprice Global Index) prognozė eilutės trendo metodu. Pagrindinis šio straipsnio tikslas) – įvertinti meno vertybių kaip investicinės priemonės tinkamumą portfeliams diversifikuoti. Šiam tikslui pasiekti buvo atlikta koreliacinė regresinė analizė. Nustačius, kad meno vertybės yra tinkama investicijų priemonė portfeliams diversifikuoti, buvo sudaryti 3 investicijų portfeliai be meno vertybių ir 5 investicijų portfeliai, kur viena iš investicinių priemonių yra meno vertybės. Taip pat buvo palygintos skirtingų investicijų portfelių efektyvios ribos ir nustatytas kiekvieno portfelio, kur viena iš investicinių priemonių yra meno vertybės, pelningumas bei rizika